The Board of Directors wishes to announce that the Company, as part of a group of Malaysian Companies comprising Putera Capital Berhad ("PCB" or "the Company"), KUB Power Sdn Bhd ("KUBP"), Nexus Star Holdings Sdn Bhd ("NSHSB") and Realmild (M) Sdn Bhd ("RMSB") had on 28 May 2004 entered into a Memorandum of Agreement ("MOA") in Beijing, The People's Republic of China with China National Electric Equipment Corporation ("CNEEC") (collectively hereinafter referred to as "The Parties").

The purpose of the MOA is to jointly prepare a Technical and Financial Proposal to secure the Upgrading and Reinforcement of Tenaga Nasional Berhad ("TNB")'s current Transmission Lines and Substations and the Constuction and Completion of new High Voltage Transmission Lines and Substations, including the 500kV/275kV/132kV High Voltage Transmission Line and its associated Substations in Peninsular Malaysia (hereinafter called the "Missing Link" Project or "MLP") which is to be implemented and completed in line with TNB's 2003-2010 Electricity Demand Forecast.

The Parties shall provide combined packages of Foreign (China) and Malaysian Private Sector Engine of Growth by financing for the foreign portions through China Export Credit and for the local portions through Malaysian Capital Market Funding and/or Public Private Partnership ("PPP"), Private Finance Initiative ("PFI") or Build Lease Operate and Transfer ("BLOT") Scheme, whichever is acceptable to the Malaysian Government and TNB.

The MLP shall be undertaken on Privatisation Basis with the Scope of Works includes, inter alia:-
1. 455km of 500kV double circuit normal overhead transmission lines from Bukit Tarek to Yong Peng.
2. 170km of 500kV double circuit normal overhead transmission lines from Kuala Lumpur East to Paka.
3. 2 new 500kV Substations at Bentong and Lenggeng.
4. Upgrade of Yong Peng North, Yong Peng East, Permas Jaya, Bukit Batu, Olak Lampit, Junjung, Gurun and Kuala Lumpur East Substations to 500kV, as well as upgrade of Kg Awah and Paka Substation to 500kV.
5. Close the Loop between Salak South and Sentul Raya Substations with a 275kV double circuit normal overhead line.

The estimated cost corresponding to the Scope of Works is USD1 (One) Billion, subject to confirmation upon completion of System Study covering technical, financial, legal, environmental and survey study by the Parties and acceptance of them by TNB.

The Ministry of Energy, Water and Communications, Malaysia shall assist the Parties to procure TNB to enter into a MOA exclusively with the Parties and to co-operate with the Parties in providing all related data and information pertaining to the Scope of Works of the "Missing Link" Project.

The costs and expenses incurred in the preparation of the System Study and the Proposal will be borne by CNEEC.

If the Proposal is accepted by TNB, CNEEC shall be appointed as the Engineering, Procurement, Construction and Commissioning ("EPC") Contractor.

If the Proposal is not accepted by TNB on ground of non-viability, NSHSB shall be responsible to reimburse the costs and expenses incurred by CNEEC in the preparation of the System Study and the Proposal.